Disability Insurance for Executives: Why Income Protection Is Non-Negotiable
For business executives, medical professionals, and other high-income earners, protecting your income is just as important as growing your assets. One unexpected illness or injury could derail decades of hard work and significantly impact your lifestyle, your family, and your long-term plans.
Disability income insurance provides a financial safety net—paying you a monthly benefit if you’re unable to work due to a covered disability.
Why It Matters More for High Earners
Let’s say you’re a 35-year-old executive earning $200,000 annually, with 30 years until retirement. That’s $6 million in future income at stake. A serious illness or injury—even one that keeps you out of work for just a few years—could result in a devastating loss of earning potential.
Disability insurance from top-tier carriers like MassMutual offers own-occupation protection, meaning if you can’t do the specific job you were trained for, benefits still pay—even if you can work in another role. That’s critical for executives, physicians, and specialized professionals.
It’s Not Just About Accidents
Most people think disability insurance only covers physical injuries, but in fact, the majority of claims are caused by illnesses, including:
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Musculoskeletal disorders
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Cancer
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Neurological conditions
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Mental health disorders
This makes having a strong policy in place even more essential—because the risk is broader than most people think.
At Diversified Insurance Brokers, we help successful professionals design disability insurance strategies that protect their income, their lifestyle, and their long-term goals.
Visit our disability insurance page here:
https://www.diversifiedquotes.com/services/disability-insurance/
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Ready to explore insurance and annuity options that offer guaranteed income, principal protection, disability, life insurance, Social Security and Medicare reviews, and long-term financial growth? Let the expert advisors at Diversified Insurance Brokers help you find the right strategy for your retirement goals.
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FAQs: Disability Insurance for Executives
Why do executives need disability insurance?
Executives often rely on high incomes, bonuses, and stock-based compensation. Disability insurance protects these earnings if illness or injury prevents them from working. It ensures financial stability while preserving long-term planning strategies, including retirement and wealth-building goals.
What makes executive disability insurance different?
Executive coverage typically includes higher benefit limits, true own-occupation definitions, supplemental bonuses or incentive income protection, and broader contract features than standard group disability plans. Many executives add individual policies to fill gaps in employer coverage.
Does employer disability coverage provide enough protection?
Often, no. Group plans typically cap income protection and may not include bonuses, commissions, or equity compensation. Executives frequently need individual policies to bridge the gap and ensure full income protection.
What income sources can be insured?
Base salary, bonuses, commissions, and certain types of variable compensation may be insurable. Executive policies often protect a higher percentage of income to match lifestyle and financial commitments.
What is a “true own-occupation” disability definition?
This definition pays benefits if an executive cannot perform their specific job duties—even if they can work in another occupation. It offers stronger protection and is common in high-level professional roles.
Are executive disability benefits taxable?
If the executive pays the premiums personally, benefits are typically tax-free. If the employer pays premiums, benefits are generally taxable. Many executives opt for individually owned policies for this reason.
Can disability insurance coordinate with my retirement plan?
Yes. Some executive policies include retirement protection riders that continue funding a retirement account during a long-term disability. This prevents a major retirement savings shortfall.
What optional riders are available?
Executives often consider cost-of-living adjustments, enhanced own-occupation riders, future insurability options, catastrophic disability benefits, and supplemental coverage for bonuses or equity bonuses.
How do I determine how much disability insurance I need?
Most executives insure 60%–70% of total earnings, including bonuses. The exact amount depends on lifestyle, debt, financial obligations, and retirement strategy. Review your income sources and compare needs using guidance from a licensed advisor.
Can I get disability insurance if I already have a health condition?
Possibly. Underwriting varies, but executives with prior conditions may still qualify with exclusions, rated premiums, or modified benefits. A broker can compare multiple carriers to find the most favorable option.
About the Author:
Jason Stolz, CLTC, CRPC, is a senior insurance and retirement professional with more than two decades of real-world experience helping individuals, families, and business owners protect their income, assets, and long-term financial stability. As a long-time partner of the nationally licensed independent agency Diversified Insurance Brokers, Jason provides trusted guidance across multiple specialties—including fixed and indexed annuities, long-term care planning, personal and business disability insurance, life insurance solutions, and short-term health coverage. Diversified Insurance Brokers maintains active contracts with over 100 highly rated insurance carriers, ensuring clients have access to a broad and competitive marketplace.
His practical, education-first approach has earned recognition in publications such as VoyageATL, highlighting his commitment to financial clarity and client-focused planning. Drawing on deep product knowledge and years of hands-on field experience, Jason helps clients evaluate carriers, compare strategies, and build retirement and protection plans that are both secure and cost-efficient.
